17 Benefits of Aadhaar Card, Why it is Mandatory, Important Uses

Aadhaar program was launched in 2009 with a main objective to provide universal identity to every Indian resident. However in the initial stages of enrollment people faced lot of difficulties such as technical snags, incorrect data displayed, etc. and also the importance of Aadhaar card was unclear.

But many of the issues were resolved and people can now get the card with much ease as its acceptance as a mandatory document for various initiatives has been officially made. In addition to this it will help in reducing the corruption since every individual carries only one unique number.

Benefits of Aadhaar Card

Listed below are the most important benefits of Aadhaar card (12 digit unique identity number) and why it is must for every Indian moving forward.

  1. Aadhaar based Direct Benefit Transfer (LPG Subsidy): The 12 digit individual identification number on Aadhar card is used to get LPG subsidy amount directly in the bank account. This DBTL scheme is named as PAHAL. To get this benefit you need to visit your area’s distributor and get Aadhar number linked to the 17 digit LPG consumer number. Although now you can get direct benefit transfer by linking bank account to the LPG number. Read more about PAHAL scheme.
  2. Jan Dhan Yojana: The guiness world record holder scheme Pradhan Mantri Jan Dhan Yojana (PMJDY) accepts Aadhaar card/number as the only document sufficient to open the bank account. Although you open PMJDY account after producing other documents as well. The benefits offered are RuPay card, free zero balance savings account, life and accident insurance and many others. Read more on how to open PMJDY account with no valid documents.
  3. Passport in 10 days: This benefit of Aadhaar card will relieve you the most! If you have an Aadhaar card, you can get passport in just 10 days. Under this format, police verification will be done at a later date as opposed to the previous rule requiring police verification which used to be time consuming. Also under the new government’s rule, if you need a passport, Aadhaar number is compulsory.
  4. Digital Locker: Government of India has launched digital locker (DigiLocker) system for everyone for storing all personal document on the government’s server. And sign-up process for DigiLocker requires person to link his/her 12 digit Aadhaar card number. Check out benefits of DigiLocker.
  5. Voter Card Linking: Starting 9th March 2015, Aadhaar card UIDAI number would be linked to the voter ID’s. This action is taken to eliminate bogus voters. Once an Aadhaar number is linked, it would become impossible for an multiple voter ID card holder to make it’s illegal use, as registration requires voter card holder to
    be physically present and produce Aadhaar card to the polling booth officer for linking.
  6. Monthly Pension: All the pensioners from select states will now have to register their Aadhaar card number to their respective department in order to receive monthly pension. This move was initiated as there have been fraudulent incidents as beneficiaries requesting pension were found to be fake.
  7. Provident Fund: Similar to pension, provident fund money will be given to the account holder who’ve registered their Aadhaar number with employee provident fund organization (EPFO).
  8. Opening new bank account: Aadhaar letter provided by UIDAI is now acceptable by banks as a valid proof to open bank account. In fact, it can serve as an address proof as well provided address on Aadhaar card and address proof perfectly matches. i.e. no need to produce bunch of documents to the banks for opening the account. Check out benefits of linking Aadhaar number and bank account.
  9. Digital Life Certificate: Aadhaar linked digital life certificate is another initiative which was launched by Department of Electronics and IT. Named as
    “Jeevan Praman for Pensioners”, this system will end the process where pensioner had to be physically present at Pension Disbursing Agency to avail pension. Instead all the details of pensioner will be accessed digitally by the agency.
  10. SEBI: It is now accepted as a proof of address by Securities and Exchange board of India for investing in stock market. Till now, it was used by SEBI as identity proof.

Considering the increasing acceptance of Aadhaar card it is must for everyone to get it issued. It is believed that the card will further be given more importance as more and more government schemes are being launched requiring it as a mandatory document.

Latest Update as on Sep’2017

The benefits of Aadhaar number cannot be ignored now onwards as it has now been made mandatory for the most important day to day activities we do:

Mobile number: All existing mobile subscribers (prepaid and postpaid) are required to link Aadhaar to the mobile number. If not done before February 2018, SIM card will face risk of being getting deactivated. And henceforth, all new connections will require Aadhaar linking.

Driving license: To make Aadhaar, a digital identity, very soon driving license would be linked to Aadhaar number. The objective of doing this is to check multiple license. Government will release more information on this very soon.

PAN card & IT return: This is considered to be the best step to curb black money. Linking of PAN card with Aadhaar has been made mandatory. And not doing so will result in PAN deactivation and IT return would be considered invalid. The deadline is 31st December 2017. Earlier the government had kept the deadline to 31st August 2017.

Investments: Submitting Aadhaar before 31st December 2017 to financial institutions where you are doing mutual fund and other investments is now mandatory.

3 latest updates – June 2017: Aadhaar Car & Banking

Aadhaar card will be mandatory for the following banking related processes:

  1. New bank account opening: Government of India has made Aadhaar card mandatory for opening new bank account.
  2. Existing bank account holders: They will have to provide 12 digit number to the banks where they hold account before December 2017. If not done, account will be declared invalid till the time details are provided.
  3. Financial transactions above Rs. 50, 000: Aadhaar will be must for making transactions above Rs. 50, 000.


Hi, I am Nikesh Mehta, owner and writer of this site. I’m an analytics professional and also love writing on finance and related industry. I’ve done online course in Financial Markets and Investment Strategy from Indian School of Business. I can be reached at [email protected].

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